CAL-MAINE FOODS INC (NASDAQ:CALM) Combines High Growth Momentum with Strong Technical Trend

The method used in finding promising investment opportunities joins Mark Minervini's strict Trend Template with a focus on high growth momentum. Minervini's system highlights stocks showing strong technical condition through specific moving average arrangements, price level compared to 52-week ranges, and solid relative strength. This technical base is then combined with a High Growth Momentum (HGM) score, which measures a company's fundamental ability for fast earnings and sales increases, large profit margin gains, and favorable analyst estimate changes. This two-step filtering makes sure picks are both in strong uptrends and show the essential financial energy typical of market leaders.

CAL-MAINE FOODS INC (NASDAQ:CALM) appears as a strong candidate from this filtering process, satisfying the strict requirements on both sides.

Technical Strength Viewed by the Trend Template

A main idea of Minervini's plan is to buy in the direction of the current trend, which greatly raises the chance of a good outcome. CALM's chart displays the signs of a stock in a strong Stage 2 climb.

• Moving Average Arrangement: The stock's present price trades well above its important moving averages (50-day, 150-day, and 200-day), a main filter in the Trend Template. Importantly, all these averages are themselves in upward movements, with the shorter-term 50-day SMA placed above the longer-term 150-day and 200-day SMAs. This ordered, rising formation is a clear sign of continued positive momentum and is a required state for Minervini, as it confirms strength over several timeframes.
• Price Action: CALM's price is much higher than its 52-week low, having gained over 54% in the past year. More significantly, it is trading not far from its 52-week high. Minervini suggests that stocks close to new highs frequently have the momentum to keep rising, as they are often leaders in their industry.
• Better Relative Strength: With a relative strength (RS) ranking above 89, CALM is doing better than most of the market. A high RS number is a vital part of the strategy, as it finds stocks that are not only going up, but going up quicker than the wider market, a main feature of real market leaders.

Fundamental Energy for High Growth Momentum

While the Trend Template finds how a stock is moving, the HGM score judges why it might be moving. CALM's strong fundamental performance gives a strong reason for its price increase.

• Strong Earnings Growth: The company has reported amazing year-over-year earnings growth, with EPS (TTM) jumping by over 393%. This speed increase is not a single event; recent quarterly EPS growth numbers have been very strong, including a 203% rise in the last quarter. Minervini's work shows that "large earnings draw large notice," often from big investors who can push a stock much higher.
• Solid Sales Increase and Profitability: This earnings jump is supported by impressive revenue growth of over 83% (TTM), showing high demand for its goods. Also, the company has greatly increased its profit margins, with the last quarter's margin above 31%. Getting better margins point to pricing control and good operations, which are signs of a high-quality growth company and a main point in Minervini's fundamental review.
• Favorable Analyst Changes: While next-year EPS projections have stayed the same, revenue projections for the next year have been changed upward by over 32% in the last three months. This upward change is a strong sign, as it shows that analysts are growing more positive about the company's future, often resulting in continued big investor buying.

Technical and Setup View

The technical report for CALM gives a top rating of 10, showing its outstanding technical condition with good long and short-term movements. It also shows a good setup rating of 7, pointing to a pause pattern inside its uptrend. The review finds a clear support area near the $107 - $108 level, which lines up with important moving averages, giving a sensible place for a protective stop-loss order. A full list of these technical items can be seen in the full technical report.

For investors looking for other chances that fit this mix of strong technical trends and high-growth fundamentals, more results can be found using the High Growth Momentum + Trend Template screen.

Disclaimer: This review is for information and learning only and is not meant as investment guidance. The examples given are for demonstration. Investors should do their own research and think about their personal money situation and risk comfort before making any investment choices.